Author: @0xjiawei
Previous chapters covered the big picture: stablecoins are evolving from mere transaction tools into broad channels for the U.S. dollar.
Let’s see how the stablecoin pie is divided.
I will categorize stablecoins into four tiers:
- Issuance layer: Minting stablecoins, holding reserve assets, and earning the spread. Representatives include Tether and Circle;
- Infrastructure layer: Integrating stablecoins into the real-world financial system—fiat on/off-ramps, bank integrations, asset management, compliance. Examples: Bridge (acquired by Stripe), BVNK (acquired by Mastercard), Bitso, Yellow Card, and others.
- Acquisition/Distribution Layer: Integrate stablecoins into merchant systems, manage payment workflows, and connect with enterprise financial software. Representatives: Stripe, Infini, Coinbase.
- Application layer: Users and businesses that ultimately use stablecoins for payments, settlement, and value storage.
The issuance layer receives user funds and captures the widest spread; the two middle layers rely on traffic, distribution commissions, and underlying infrastructure; the application layer enjoys convenience but has no bargaining power.
I think the infrastructure layer is currently not favored by most people.
It handles the tough, behind-the-scenes work: integrating with banks, managing KYC/AML, processing local fiat deposits and withdrawals, onboarding merchants, connecting APIs, partnering with card networks, and resolving settlement and regulatory issues across different countries.
But on the flip side, this is precisely where the moat lies. After all, technically speaking, transferring USDC on-chain isn’t difficult—the real challenge is penetrating the real world and convincing a Latin American company, an African payment provider, or a cross-border platform to integrate stablecoins into their daily cash flows. These messy, labor-intensive tasks simply must be done by someone.
The on-chain part is the simplest; the part between the chain and reality is the hardest.
Seeing stablecoin payments for the first time, you might think: it can be transferred on-chain, confirmed quickly, with low fees—aren’t the rest just distributing products to users?
But the real challenge with stablecoins lies in the vast gap between blockchains and the real financial system. Enterprises face decision-making and migration costs—they won’t switch their established workflows just because they’ve heard stablecoins can settle in one second.
There will be a series of questions here: How do I convert fiat currency to stablecoins? How do I convert them back? How do I handle reconciliation and taxes? Will my bank block me in the future? Do users still need to learn how to use a wallet?
The core function of the infrastructure layer is to connect both sides: one side to blockchains and wallets, the other to banks, local payment networks, enterprise systems, and compliance.
In 2025, Stripe acquired Bridge and its stablecoin orchestration suite—enabling businesses to integrate stablecoin capabilities into their systems. In March 2026, Mastercard announced its acquisition of BVNK for similar reasons.
In other words, the entry point that traditional payment companies are competing for is who can become the default channel for businesses using stablecoins.
Whether stablecoin payments can be scaled depends on this.
Pioneer
Take one more step forward and look at the infrastructure layer:
- Deposit and withdrawal + currency exchange. Most business scenarios require the process of "local currency → stablecoin → local currency," involving issues such as banking relationships, compliance, and liquidity.
- API and account layer. Enterprises need a set of financial capabilities embedded into their business processes—account opening, receiving and making payments, fund allocation, settlement, and reconciliation. This is somewhat like a financial SaaS solution, similar to the concept of neobanks.
- Payment network connectivity. The more payment rails, banks, and regions integrated, the more customers become dependent, and the switching cost gradually increases.
- Capital efficiency. Help businesses reduce idle funds, wait times, and foreign exchange losses.
I believe it has three characteristics that determine it must be bitter first, then sweet.
- Hard, messy, and labor-intensive work—having to connect with banks, establish compliance, obtain licenses, and build local teams country by country.
- You need to burn money first to secure entry points. Enterprises won’t easily switch their payment infrastructure. Whoever secures large clients, banking relationships, compliance pathways, and local fiat rails first will gain network effects later. These companies are currently in a “land grab” phase—far from reaping the harvest.
- Squeezed between upstream and downstream. Upstream issuers take the spread first, while downstream platforms want to control user access. Infrastructure providers are caught in the middle, in a precarious position where everyone needs you, but no one wants you to make too much profit.
It is currently in the intermediate stage of moving toward "bargaining power formation."
If viewed solely today, the issuance layer captures the largest profits, while the infrastructure layer is thinner and heavier.
But if we really talk about how to invest in stablecoins, the seigniorage logic at the issuance layer is already well understood by the market, and pricing will increasingly revolve around interest rates, regulation, and yield returns. The infrastructure layer is less prominent today, often simply because it’s still in the early investment phase, with bargaining power and user habits yet to fully form.
Once stablecoins become the default financial backbone for businesses, those who have integrated stablecoins into real-world commercial systems over the years will be the ones truly sitting back and reaping the rewards.